Angel Investing explained!
There’s not a lot that Kris Trevilyan can’t turn her hand to. She’s a self-confessed jack of all trades, master of few, but I think that’s a bit modest! Her (current!) day job is managing a cropping enterprise at Banana in Central Queensland, but she’s also an inventor, manufacturer and an alternative health therapist.
I caught up with her to talk about Angel Investing. It’s like a miracle cure for budding entrepreneurs, but it’s also a complicated and daunting concept.
“Angel Investors are a group of likeminded, ex entrepreneurs or people who have got money to invest in start-up companies,” she says.
“We use the space between the ‘Friends Family Fools’ who help get ideas off the ground, usually at protoype level and the banks, which usually only fund if you have equity.”
“We work on the basis that nine out of 10 deals typically fail. So we are either idiots or just ridiculously over optimistic. “
Kris is a member of the Brisbane Angels- a chapter if you like of an international organisation of Angel Investors.
The Brisbane Angels is a diverse group which Kris says is absolutely wonderful because of the diversity of skill sets, including a lot of rural people which is apparently quite unusual. They also have a Darwin member and an Aussie living in China.
So how does it work?
Typically, an entrepreneur will have a good idea, hopefuly to the point of a prototype (a lot of the ideas at the moment are pharmaceutical and tech, with the occasional agricultural one) and contact the group to hopefully attract some funding.
“What we’re looking for has got to be scalable and transferable to the Worldwide stage,” says Kris.
“If they get through the initial screening process, we invite them to a meeting where they present in front of a panel. And if they get through that stage, they are shown to the room where the money is.”
But as Kris points out, the most valuable part of the whole thing for the entrepreneur is the huge amount of mentoring from the Angels and access to impressive business connections.
“Angels are there to have fun, because if you don’t enjoy it, why are you there in the first place?”
“You only invest the money that you are prepared to lose,” she says.
“All of the money I have invested, I have written off, it doesn’t even factor in my budget. If it comes off then that’s a bonus, but if it fails and I lose it, it’s not going to jeopardise my lifestyle.”
Typically it’s seven years before you start seeing your money back.
Listen to the podcast episode for our fun chat where we cover this as well as the top things you need to keep in mind when pitching to an investor and how to get an Angel Investors attention. LISTEN HERE